McDonald’s Wins Battle, Loses War
The European Union Intellectual Property Office (“EUTM”) recently cancelled McDonald’s trademark registration for the BIG MAC word mark because it had not been put to “genuine use” in the European Union (“EU”) for five continuous years following the date of registration. Registered in the EU on December 12, 1998 (Registration No. 62 638), the now-canceled BIG MAC mark covered the following goods and services:
“Foods prepared from meat, pork, fish and poultry products, meat sandwiches, fish sandwiches, pork sandwiches, chicken sandwiches, preserved and cooked fruits and vegetables, eggs, cheese, milk, milk preparations, pickles, desserts, in class 29;
Edible sandwiches, meat sandwiches, pork sandwiches, fish sandwiches, chicken sandwiches, biscuits, bread, cakes, cookies, chocolate, coffee, coffee substitutes, tea, mustard, oatmeal, pastries, sauces, seasonings, sugar, in class 30; and
Services rendered or associated with operating and franchising restaurants and other establishments or facilities engaged in providing food and drink prepared for consumption and for drive-through facilities; preparation of carry-out foods; the designing of such restaurants, establishments and facilities for others; construction planning and construction consulting for restaurants for others, in class 42.”
While certainly not the happiest of meals for McDonald’s to endure, this decision (EUTM Cancellation No. 14 788) affords trademark owners guidance on multiple fronts.
Opposition = Defense
Ironically, McDonald’s BIG MAC registration was canceled in the EU after it prevailed in its opposition against Supermac’s (Holdings) Ltd. (“SHL”). In opposing, McDonald’s alleged that SHL’s SUPERMAC’S mark – for “services for providing food and drink; restaurant services; fast-food restaurant services; canteens; self-service restaurant services; takeaway services; snack-bars” – was confusingly similar to BIG MAC. With the marks comprising “MAC” along with comparable words suggesting size, namely, “BIG” in one and “SUPER” in the other, the EUTM ruled in McDonald’s favor, denying SUPERMAC’S registration on likelihood of confusion grounds.
However, in the EU, any third-party can initiate a non-use cancellation proceeding against a mark when five years of non-use have passed since registration. A non-use cancellation proceeding or the threat of one is often leveraged by an applicant against an opposer to withdraw an opposition. Therefore, a party should exercise caution when opposing a mark. This is especially true as an opposer can quickly become a defendant with the burden of establishing “genuine use” of its mark before the EUTM.
Absent “genuine use,” a registrant’s mark is subject to cancellation. And without a registration, because the EU is a “first to register” jurisdiction, the trademark owner’s rights can be totally extinguished.
Minus “proper reasons” for non-use, the owner of an EUTM must establish “genuine use” of its trademark for the goods and services for which it is registered or risk surrendering the associated registration. “Genuine use,” under Article 58(1)(a) of the European Union Trademark Regulation, requires “actual use on the market” for the registered goods and services. Accordingly, neither token nor internal use suffices to preserve a registration up for cancellation on non-use grounds.
Conversely, “genuine use” is not determined by a registrant’s “commercial success.” Instead, according to the EUTM decision, it must be evaluated by the evidence of record reflecting the “place, time, extent and nature of use.”
The owner of an EU trademark registration should therefore, at a minimum, clearly document where its products have been advertised, distributed and sold. Further best practices for a registrant include meticulously tracking the volume, duration and frequency of sales associated with its mark – beginning with registration – including information regarding “actual sales taking place.”
Defending against the SHL’s non-use action, McDonald’s relied upon three affidavits signed by its representatives attesting to sales of BIG MAC sandwiches in Germany, France and the UK from 2011-2016. McDonald’s also relied upon several company-generated brochures, website printouts (from 2014-2016) depicting various sandwiches, sandwich-box packages and posters “showing a sandwich on the menu along with other products.”
Applying the “genuine use” standard, the EUTM quickly dismissed the affidavits as biased and having minimal “probative value” since McDonald’s drafted them as an “interested party.”
Similarly, the EUTM dismissed McDonald’s remaining evidence because it did not establish the place, time or extent of use. For example, the mere presence of BIG MAC on several web pages was found insufficient. Instead, to be probative, there must be accompanying evidence showing the internet traffic tied to the web pages including the number of visitors and countries “from which the web page has been accessed.” Helpful, but also missing from McDonald’s evidence: information about actual food orders placed, the number of products (e.g., sandwiches) sold and the consumers’ overall interaction with the brochures and posters of record.
None of the registered services were referenced in any of the evidence McDonald’s submitted to prove “genuine use” of BIG MAC either. As a result, the EUTM canceled the BIG MAC mark for all goods and services listed in Registration No. 62 638.
Not only did McDonald’s lose its BIG MAC word mark registration; SHL is now positioned to register its SUPERMAC’S mark in all current EU Member Countries. And were McDonald’s to file a new application for BIC MAC in the EU, SHL will likely block it! Given the EUTM decision and sequence of events, consider the following takeaways for EU trademarks:
- Log the registration date, docket all renewal deadlines and begin use of the mark, as registered, as soon possible.
- Before opposing an application, thoroughly vet the supporting registration and confirm what goods and/or services the associated mark covers.
- Check that the mark, as registered, is being put to “genuine use” for all the goods and/or services specified in the application.
- Should the United Kingdom leave the EU, “genuine use” in Germany and France, as the other “economically most important Member States,” is further probative.
- Partial “genuine use,” meaning actual use for some but not all the goods and/or services covered by the registration, may serve as grounds to at least preserve a share of the registration.
- Extent of use is key to showing “genuine use.” Extent of use factors include the nature of the goods or services at issue, marketplace characteristics, the territories of use and the commercial volume, duration and frequency of sales.
- Extent of use can be shown by sales materials inclusive of offers for sale and actual purchases, how as well as to whom any advertising (e.g., posters, brochures) are circulated, web page traffic records and information for placing orders.
- In a non-use cancellation, the losing party (McDonald’s in this case) must pay the other side’s fees and costs.